1. What is income tax slab ?

Indian Income tax levies tax on individual taxpayers on the basis of a slab system. Slab system means different tax rates are prescribed for different ranges of income. It means the tax rates keep increasing with an increase in the income of the taxpayer. This type of taxation enables progressive and fair tax systems in the country. Such income tax slabs tend to undergo a change during every budget. These slab rates are different for different categories of taxpayers. Income tax has classified three categories of “individual “taxpayers

NOTE:

• Please note that the tax rates in the New tax regime is the same for all categories of Individuals, i.e Individuals & HUF upto 60 years of age, Senior citizens above 60 years upto 80 years , and Super senior citizens above 80 years. Hence no increased basic exemption limit benefit will be available to senior and super senior citizens in the New Tax regime.

• Individuals with Net taxable income less than or equal to Rs 5 lakh will be eligible for tax rebate u/s 87A i.e tax liability will be nil of such individual in both – New and old/existing tax regimes.

• Basic exemption limit for NRIs is of Rs 2.5 Lakh irrespective of age.

• Additional Health and Education cess at the rate of 4 % will be added to the income tax liability in all cases. (increased from 3% since FY 18-19)

• Surcharge applicable as per tax rates below in all categories mentioned above:

  1. 10% of Income tax if total income > Rs.50 lakh

  2. 15% of Income tax if total income > Rs.1 crore

  3. 25% of Income tax if total income > Rs.2 crore

  4. 37% of Income tax if total income > Rs.5 crore